New Delhi:Ahead of the Assembly elections in Haryana and Jammu and Kashmir, the Union Cabinet, chaired by Prime Minister Narendra Modi, Saturday launched the “unified pension scheme” (UPS) assuring 50 per cent of salary as pension for over 23 lakh Central government employees who joined service under the National Pension System (NPS).
Mr Modi said the UPS ensures dignity and financial security for government employees, aligning with the government's commitment to their well-being and secure future.
"We are proud of the hard work of all government employees who contribute significantly to national progress. The Unified Pension Scheme ensures dignity and financial security for government employees, aligning with our commitment to their well-being and a secure future,” Mr Modi said in a post on X.
Announcing Cabinet decisions, information and broadcasting minister Ashwini Vaishnaw said that the new scheme will be implemented from April 1, 2025 and employees will have the option to choose between the NPS or UPS.
Amid continued protests by the many non-BJP ruled states over the existing “New Pension Scheme”, the UPS assures 50 per cent of the average basic salary for the last 12 months before retirement as pension for government employees who complete a minimum of 25 years in service.
The NPS is applicable for government employees joining the service after April 1, 2004.
For this full pension, he said, the eligibility service length will be 25 years. However, Mr Vaishnaw said, it will be proportionate for a lesser service period up to a minimum of 10 years of service, assuring minimum pension of Rs 10,000 per month on superannuation after minimum 10 years of service. The existing NPS subscribers can now opt for the UPS from the beginning of the next financial year.
The UPS also made a provision of 60 per cent of the pension to the pensioner’s family in case of death of the pensioner.
As per the current pension scheme, employees contribute 10 per cent while the Central government contributes 14 per cent, which would be increased to 18 per cent with the UPS.
Last year, the finance ministry set up a committee under finance secretary T.V. Somanathan to review the pension scheme for government employees and suggest any changes, if needed, in light of the existing framework and structure of the NPS.
Several non-BJP-ruled states have decided to revert to the DA-linked Old Pension Scheme (OPS) and also employee organisations in some other states have raised demand for the same.
The benefits of the Unified Pension Scheme are applicable for those retired and retiring till March 31, 2025, with arrears, he added.
